APCC Response Survey HMT’s consultation and call for evidence on the “Future financial services regulatory regime for cryptoassets”

1.1 Definition of cryptoasset and legislative approach; pg. 17 Do you agree with HM Treasury's proposal to expand the list of “specified investments” to include cryptoassets? If not, then please specify why.

2.2 Definition of cryptoasset and legislative approach; pg. 17 Do you agree with HM Treasury's proposal to leave cryptoassets outside of the definition of a "financial instrument"? If not, then please specify why.

3.3 Definition of cryptoasset and legislative approach; pg. 17 Do you see any potential challenges or issues with HM Treasury’s intention to use the DAR to legislate for certain cryptoasset activities?

4.4 Overview of the current regulatory landscape for cryptoassets; pg. 23 How can the administrative burdens of FSMA authorisation be mitigated for firms which are already MLR-registered and seeking to undertake regulated activities? Where is further clarity required, and what support should be available from UK authorities?

5.5 Overview of the current regulatory landscape for cryptoassets; pg. 23 Is the delineation and interaction between the regime for fiat-backed stablecoins (phase 1) and the broader cryptoassets regime (phase 2) clear? If not, then please explain why.

6.6 Overview of the current regulatory landscape for cryptoassets; pg. 23 Does the phased approach that the UK is proposing create any potential challenges for market participants? If so, then please explain why.

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7.7 Cryptoasset Activities; pg. 33 Do you agree with the proposed territorial scope of the regime? If not, then please explain why and what alternative you would suggest.

8.8 Cryptoasset Activities; pg. 33 Do you agree with the list of economic activities the government is proposing to bring within the regulatory perimeter?

9.9 Cryptoasset Activities; pg. 33 Do you agree with the prioritisation of cryptoasset activities for regulation in phase 2 and future phases?

10.10 Cryptoasset Activities; pg. 33 Do you agree with the assessment of the challenges and risks associated with vertically integrated business models? Should any additional challenges be considered?

11.11 Cryptoasset Activities; pg. 33 Are there any commodity-linked tokens which you consider would not be in scope of existing regulatory frameworks?

12.12 Cryptoasset Activities; pg. 33 Do you agree that so-called algorithmic stablecoins and crypto-backed tokens should be regulated in the same way as unbacked cryptoassets?

13.13 Cryptoasset Activities; pg. 33 Is the proposed treatment of NFTs and utility tokens clear? If not, please explain where further guidance would be helpful.

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14.14 Regulatory Outcomes for Cryptoasset Issuance and Disclosures; pg. 40 Do you agree with the proposed regulatory trigger points – admission (or seeking admission) of a cryptoasset to a UK cryptoasset trading venue or making a public offer of cryptoassets?

15.15 Regulatory Outcomes for Cryptoasset Issuance and Disclosures; pg. 40 Do you agree with the proposal for trading venues to be

responsible for defining the detailed content requirements for admission and disclosure documents, as well as performing due diligence on the entity admitting the cryptoasset? If not, then what alternative would you suggest?

16.16 Regulatory Outcomes for Cryptoasset Issuance and Disclosures; pg. 40 Do you agree with the options HM Treasury is considering for liability of admission disclosure documents?

17.17 Regulatory Outcomes for Cryptoasset Issuance and Disclosures; pg. 40 Do you agree with the proposed necessary information test for cryptoasset admission disclosure documents?

18.18 Regulatory Outcomes for Cryptoasset Issuance and Disclosures; pg. 40 Do you consider that the intended reform of the prospectus regime in the Public Offers and Admission to Trading Regime would be sufficient and capable of accommodating public offers of cryptoassets?

19.19 Regulatory Outcomes for Operating a Cryptoasset Trading Venue; pg. 44 Do you agree with the proposal to use existing RAO activities covering the operation of trading venues (including the operation of an MTF) as a basis for the cryptoasset trading venue regime?

20.20 Regulatory Outcomes for Operating a Cryptoasset Trading Venue; pg. 44 Do you have views on the key elements of the proposed cryptoassets trading regime including prudential, conduct, operational resilience and reporting requirements?

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21.21 Regulatory Outcomes for Cryptoasset Intermediation Activities; pg. 48 Do you agree with HM Treasury's proposed approach to use the MiFID derived rules applying to existing regulated activities as the basis of a regime for cryptoasset intermediation activities?

22.22 Regulatory Outcomes for Cryptoasset Intermediation Activities; pg. 48 Do you have views on the key elements of the proposed cryptoassets market intermediation regime, including prudential, conduct, operational resilience and reporting requirements?

23.23 Regulatory outcomes for cryptoasset custody; pg. 53 Do you agree with HM Treasury’s proposal to apply and adapt existing frameworks for traditional finance custodians under Article 40 of the RAO for cryptoasset custody activities?

24.24 Regulatory outcomes for cryptoasset custody; pg. 53 Do you have views on the key elements of the proposed cryptoassets custody regime, including prudential, conduct and operational resilience requirements?

25.25 General Market Abuse Requirements; pg. 60 Do you agree with the assessment of the challenges of applying a market abuse regime to cryptoassets? Should any additional challenges be considered?

26.26 General Market Abuse Requirements; pg. 60 Do you agree that the scope of the market abuse regime should be cryptoassets that are requested to be admitted to trading on a cryptoasset trading venue (regardless of where the trading activity takes place)?

27.27 General Market Abuse Requirements; pg. 60 Do you agree that the prohibitions against market abuse should be broadly similar to those in MAR? Are there any abusive practices unique to cryptoassets that would not be captured by the offences in MAR?

28.28 General Market Abuse Requirements; pg. 60 Does the proposed approach place an appropriate and proportionate level of responsibility on trading venues in addressing abusive behaviour?

29.29 General Market Abuse Requirements; pg. 60 What steps can be taken to encourage the development of RegTech to prevent, detect and disrupt market abuse?

30.30 General Market Abuse Requirements; pg. 60 Do you agree with the proposal to require all regulated firms undertaking cryptoasset activities to have obligations to manage inside information?

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31.31 Regulatory outcomes for operating a cryptoasset lending platform; pg. 65 Do you agree with the assessment of the regulatory challenges posed by cryptoasset lending and borrowing activities? Are there any additional challenges HM Treasury should consider?

32.32 Regulatory outcomes for operating a cryptoasset lending platform; pg. 65 What types of regulatory safeguards would have been most effective in preventing the collapse of Celsius and other cryptoasset lending platforms earlier this year?

33.33 Regulatory outcomes for operating a cryptoasset lending platform; pg. 65 Do you agree with the idea of drawing on requirements from different traditional lending regimes for regulating cryptoasset lending? If so, then which regimes do you think would be most appropriate and, if not, then which alternative approach would you prefer to see?

34.34 Regulatory outcomes for operating a cryptoasset lending platform; pg. 65 Do you agree with the option we are considering for providing more transparency on risk present in collateralised lending transactions?

35.35 Regulatory outcomes for operating a cryptoasset lending platform; pg. 65

Should regulatory treatment differentiate between lending (where title of the asset is transferred) vs staking or supplying liquidity (where title of the asset is not transferred)?

36.36 Call for Evidence: Decentralised Finance (DeFi); pg. 69 Do you agree with the assessment of the challenges of regulating DeFi? Are there any additional challenges HM Treasury should consider?

37.37 Call for Evidence: Decentralised Finance (DeFi); pg. 69 How can the size of the “UK market” for DeFi be evaluated? How many UK-based individuals engage in DeFi protocols? What is the approximate total value locked from UK-based individuals?

38.38 Call for Evidence: Decentralised Finance (DeFi); pg. 69 Do you agree with HM Treasury's overall approach in seeking the same regulatory outcomes across comparable "DeFi" and "CeFi" activities, but likely through a different set of regulatory tools, and different timelines?

39.39 Call for Evidence: Decentralised Finance (DeFi); pg. 69 What indicators should be used to measure and verify “decentralisation” (e.g., the degree of decentralisation of the underlying technology or governance of a DeFi protocol)?

40.40 Call for Evidence: Decentralised Finance (DeFi); pg. 69 Which parts of the DeFi value chain are most suitable for establishing "regulatory hooks" (in addition to those already surfaced through the FCA-hosted cryptoasset sprint in May 2022)?

41.41 Call for Evidence: Decentralised Finance (DeFi); pg. 69 What other approaches could be used to establish a regulatory framework for DeFi, beyond those referenced in this paper?

42.42 Call for Evidence: Decentralised Finance (DeFi); pg. 69 What other best practices exist today within DeFi organisations and infrastructures that should be formalised into industry standards or regulatory obligations?

43.43 Call for Evidence: Other Cryptoasset Activities; pg. 72 Is there a case for or against making cryptoasset investment advice and cryptoasset portfolio management regulated activities? Please explain why.

44.44 Call for Evidence: Other Cryptoasset Activities; pg. 72 Is there merit in regulating mining and validation activities in the UK? What would be the main regulatory outcomes beyond sustainability objectives?

45.45 Call for Evidence: Other Cryptoasset Activities; pg. 72 Should staking (excluding “layer 1 staking”) be considered alongside cryptoasset lending as an activity to be regulated in phase 2?

46.46 Call for Evidence: Other Cryptoasset Activities; pg. 72 What do you think the most appropriate regulatory hooks for layer 1 staking activity would be (e.g., the staking pools or the validators themselves)?

47.47 Call for evidence: Sustainability; pg. 74 When making investment decisions in cryptoassets, what information regarding environmental impact and / or energy intensity would investors find most useful for their decisions?

48.48 Call for evidence: Sustainability; pg. 74 What reliable indicators are useful and / or available to estimate the environmental impact of cryptoassets or the consensus mechanism which they rely on (e.g., energy usage and / or associated emission metrics, or other disclosures)?

49.49 Call for evidence: Sustainability; pg. 74 What methodologies could be used to calculate these indicators (on a unit-by-unit or holdings basis)? Are any reliable proxies available?

50.50 Call for evidence: Sustainability; pg. 74 How interoperable would such indicators be with other recognised sustainability disclosure standards?

51.51 Call for evidence: Sustainability; pg. 74 At what point in the investor journey and in what form, would environmental impact and / or energy intensity disclosures be most useful for investors?

52.52 Call for evidence: Sustainability; pg. 74 Will the proposals for a financial services regulatory regime for cryptoassets have a differential impact on those groups with a protected characteristic under the Equality Act 2010?

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